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Get a Tax Deduction on Your Medical Aid Contribution

Thursday, 29 May 2014   (0 Comments)
Posted by: Author: Ingé Lamprecht
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Author: Ingé Lamprecht (Moneyweb Tax)

In an effort to improve the fairness and equity of the tax system, tax deductions for medical aid contributions and expenses have gradually been replaced with a tax credit system over the last few years.

Whereas a deduction reduces an individual’s taxable income, a credit (rebate) lowers their tax liability. This means that all taxpayers enjoy the same rand benefit regardless of their marginal tax rate. In the past a medical deduction was more beneficial to a taxpayer with a higher marginal tax rate.

The tax year that started on March 1 2014 marks the first time medical aid contributions and expenses for all categories of taxpayers fall within the tax credit system.

Categories of taxpayers 

  • Taxpayers younger than 65
  • Taxpayers 65 years and older, or younger than 65 but with a disability or a disabled dependent

Types of medical expenses

Two types of medical expenses qualify for a medical tax credit:

  • Medical aid contributions 
  • Qualifying out-of-pocket medical expenses

From the tax year starting March 1 2014, the monthly medical scheme contribution tax credit is R257 per month for the taxpayer and his/her first dependent and R172 per month for each additional dependent. This is applicable to all categories of taxpayers, regardless of their age or disability status.



Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.

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